Health Savings Account

HSAs are created to accompany High Deductible Health Plans (HDHP), such as UVA’s Basic Health Plan. They work like a personal bank account, giving you the opportunity to take money from your paycheck before it’s taxed and use it to pay for health care expenses, prescriptions, and over-the-counter health products. In addition to your own contributions, UVA puts money in your HSA. Funds in these accounts roll over each year and are yours to keep for future health care costs, even if you switch to Choice or Value Health or leave UVA. Learn more about how to maintain your account in these cases (administrative fees apply).

Chard Snyder

Opening an HSA

Most active, benefits-eligible employees enrolled in Basic Health are able to have an HSA

You are not eligible for an HSA if you

are a wage employee

hold a J-1 visa

are enrolled in Medicare or Medicaid or are listed as a dependent on someone else’s tax return

have a balance in a health care FSA, or a spouse has a balance in a health care FSA (you also are not eligible if you or your spouse has a balance during any part of a Flexible Spending Account grace period, or if the plan year for you or your spouse is not over)

received health care benefits from the Veterans Administration (TRICARE) within the last three months

have a spouse or parent who is enrolled in a health care plan that provides the employee with benefits (including a Health Reimbursement Account [HRA] offered by an employer) before the employee has met the IRS minimum deductible for the year

already contributed the annual federally-set limit to another HSA, Medical Savings Account (MSA), or HRA in the same calendar year

Dependent Eligibility: You may only use funds for your dependents if they are claimed as such on your taxes

Rules for Contributions and Maintenance

Timeline

Contributions are accepted starting the month after the HSA opens; UVA will make its annual contribution at this time (during the coinciding pay period)

Deposited funds become available for use on the third bank day after payday

Banking forms are completed during initial Basic Health enrollment to allow employer/employee deposits (additional info may be required; you’ll be contacted and must act if this is the case)

UVA will not make retroactive changes to excess contributions or deductions

Switching from FSA to HSA

If you do not have a zero balance in your FSA by January 1

your HSA cannot be opened and you cannot make employe contributions until April 1

UVA’s annual employer contribution will be pro-rated (you will forfeit the employer contributions for January, February, and March)

deposited funds become available for use on the third bank day after payday

you may not use money in your account to cover expenses incurred prior to April 1

Contribution Limits

The following limits reflect the total minimums and maximums, the sum of you and your employer’s contributions. Limits are per household; if you and your spouse both have HSAs, you cannot contribute more than the limit between the two of you. You are not required to make a contribution.

Your Minimum Annual Contribution: $120

Your Maximum Annual Contribution: $3,450 for an employee; $6,900 for a family

Balances roll over each year and accrue interest, and you keep the balance even if you leave UVA

Once you have a balance of $4,000 in your HSA, you may invest it in mutual funds; any growth made from the investment is tax-free as long as it is used on eligible medical expenses (refer to HSA Instructions in the resources below for details)